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USDCAD TECHS

Solid Bounce

AUDUSD TECHS

Reverses In Style

EURJPY TECHS

Accelerates Off Bull Trigger

USDJPY TECHS

Still Pointing Higher

EURGBP TECHS

Bouncing Well

GBPUSD TECHS

Bulls Press Pause

MARKET TALK
MARKET TALK: Friday saw ING highlight 7 things learnt from the latest flow data:
- 1) Following dramatic EM outflows & price falls as Covid-19 unfolded, some
inflows have resumed in recent weeks. Most of this into hard currency products.
- 2) Retail still a seller of EM local FX, was biggest seller in Mar. Evidence
of flows back into Turkey/S Africa, but no clear evidence of Brazil inflow.
- 3) There was a classic elevation in default risk in high yield as economies
jumped to recessionary state, oil price collapse was an additional stress
factor.
- 4) However, fast forward to more recent weeks and there has been an implied
re-rating of prospects in high yield, and in particular in the USD space.
- 5) Too early to tell if sustainable, default risk elevated & will become more
acute beyond Sep when most of the Fed's support facilities are due to roll off.
- 6) There has been an increase in short duration govies & money market fund
holdings, and an increase in corporate holdings along the maturity spectrum.
- 7) Holdings of inflation linked bonds are well down.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com